The Owners Strata Plan No. 72250 v Letmin Pty Limited t/as Dubbo Powder Coating

[2020] NSWDC 378

District Court

New South Wales

Medium Neutral Citation:

The Owners Strata Plan No. 72250 v Letmin Pty Limited t/as Dubbo Powder Coating [2020] NSWDC 378

Hearing dates:

16, 17, 18, 19 and 20 March 2020, 14 April 2020

Date of orders:

16 July 2020

Decision date:

16 July 2020

Jurisdiction:

Civil

Before:

Hatzistergos DCJ

Decision:

(1) Verdict and judgment for the Plaintiff in the sum of $12,395.00

(2) The Defendants are to pay interest on the said sum from 17 November 2017 to date in accordance with s 100 of the Civil Procedure Act 2005 (NSW) and District Court Practice Note 15 clause 5

(3) I will hear from the parties as to costs.

Catchwords:

TORTS– Negligence – Nuisance – Where Plaintiff Owners Corporation of Strata Plan claims First and Second Defendant caused damage to common property – Where First Defendant runs powder coating business out of Second Defendant’s Lot in Strata Complex – Whether garnet and powder was emitted during course of First Defendant’s business – Whether duty is owed by the Second Defendant to Plaintiff – Failure to take proper precautions in running of business – Whether the First Defendant’s business constituted nuisance

DAMAGES – Issue of causation – Common law and Civil Liability Act applied – Damage to roof – Whether residue caused further damage – Whether charges could be claimed for cleaning and replacing fire detectors – Whether fire detection system needed to be replaced as result of Defendants negligence – False fire alarm charges

Legislation Cited:

Civil Liability Act 2002 (NSW), ss 5B, 5D, 5E

Strata Schemes Management Act 1996 (NSW), s 45

Strata Schemes Management Act 2015 (NSW), s 145

Cases Cited:

Adelaide City Corporation v Australasian Performing Rights Association [1928] HCA 10; (1928) 40 CLR 481

Aussie Traveller Pty Ltd v Marklea Pty Ltd [1998] 1 Qd R 1; [1997] Q ConvR 54-485

Benning v Wong (1969) 122 CLR 249

Burnie Port Authority v General Jones [1994] HCA 13; (1994) 179 CLR 520

Daily Telegraph v Stuart (1928) 28 SR (NSW) 291 West v Nicholas (1915) 17 WALR 49

Dimitrios Michos & Another v Council of the City of Botany Bay [2012] NSWSC 625

Don Brass Foundry Pty Ltd v Stead (1948) 48 SR (NSW) 482

Gales Holdings Pty Ltd v Tweed Shire Council [2011] NSWSC 1128

Hargrave v Goldman (1963) 110 CLR 40

Hilton v James Smith & Sons (Norwood) Ltd (1979) 251 EG 1063 (CA)

Hussain v Lancaster County Council [2000] QB1 (CA).

Hutton v Martin Lewis Shipwrights Pty Ltd (unreported, Supreme Court of NSW, Bryson J, 19 May 1987)

Kennaway v Thompson [1981] QB 88

Kraemers v A-G (Tas) [1966] Tas SR 113

March v Stramare (E & MH) [1991] HCA 12, (1991) 171 CLR 506

Murillo v SKM Services [2019] VSC 663 at [90].

Peden P/L & Ors v Bortolazzo [2006] QCA 350

Quick v Alpine Nurseries Sales Pty Ltd [2010] NSWSC 1248

Ross & Glendinning v Hancock & Co [1929] NZLR 204

Rylands v Fletcher [1868] UKHL 1; (1868) LR 3 HL 330

Sampson v Hodson Pressinger [1981] 3 All ER 710 (CA)

Sedleigh-Denfield v O’Callaghan [1940] AC 880

Stockwell v Victoria [2001] VSC 497

Sykes v Connolly [1895] 11 WN (NSW) 145

Torette House Pty Ltd v Berkman (1940) 62 CLR 637

Woodhouse v Fitzgerald and McCoy (No 2) [2020] NSWSC 450

Texts Cited:

Balkin & Davis, Law of Torts (LexisNexis Butterworths, 5^th ed, 2013)

Sappideen, Carolyn and Prue Vines (eds), Fleming’s The Law of Torts (Lawbook, 10^th ed, 2011)

Villa, Dominic, Annotated Civil Liability Act 2002 (Thomson Reuters, 3^rd ed, 2018)

Young, M, S Loughnan and A Coorey, Court Forms, Precedents & Pleadings NSW – Nuisance Commentary (18 April 2018)

Category:

Principal judgment

Parties:

The Owners Strata Plan No. 72250 (Plaintiff)
Letmin Pty Limited t/as Dubbo Powder Coating (First Defendant)
Yangura Pty Limited (Second Defendant)

Representation:

Counsel:
Mr N. Simpson (Plaintiff)
Mr B. McManus (First and Second Defendant)

Solicitors:
Nelson Keane and Hemingway Solicitors (Plaintiff)
Wilsons Solicitors (First and Second Defendant)

File Number(s):

2017/348215

Publication restriction:

N/A

Judgment

1. The Plaintiff brings proceedings against the Defendants in respect of a repair of damage to a roof of common property structure, repair of a fire alarm system and for the costs of what is to be asserted as a false fire alarm call-outs caused by the Defendants in amounts now set to table $217,223.35[1] together with interests and costs. The claims brought against each Defendant were pleaded in negligence and nuisance. A prayer for an order pursuant to s 46 of the District Court Act 1973 (NSW) was also pleaded but not pressed. [2] The Plaintiff further conceded that the Court does not have jurisdiction to grant relief in respect of various pleaded claims pursuant to the Strata Schemes Management Act 2015 (NSW). [3]

   1. MFI E. It should be noted that this has been incorrectly calculated. See [248].

   2. T 12.39-.40.

   3. See T 12.40-.45. Strata Schemes Management Act 2015 (NSW) will hereinafter be referred to as “the 2015 Act”.

Evidence

2. The Plaintiff in its case relied on the following materials:-

1. Affidavit of Mr Gene Claude Barrett dated 3 August 2018; [4]

   4. Exhibit A1, Tab 6.

2. Report of Mr Peter Thew, civil engineer from Geolyse, 15 June 2018; [5]

3. Reports of Mr Daniel Blair, chemical engineer and environmental auditor from Virotec, dated July 2018, [6] 16 April 2019 [7] and February 2020; [8]

4. Report of Mr Graeme Walton Smith, quantity surveyor, dated 27 July 2018; [9]

5. Report of Dylan Hughes, an expert on automatic fire alarm and detection systems from Dragon Project Engineers Pty Limited, dated 27 July 2018; [10] and

6. Reports of Dr Nicholas Ward, from Southern Cross University, dated 26 July 2018 [11] and 11 February 2020. [12]

Messrs Barrett, Blair, Thew, Walton Smith and Hughes also gave oral evidence.

5. Exhibit A1, Tab 18.

6. Exhibit A1, Tab 19.

7. Exhibit A1, Tab 22 (incorrectly dated 16 April 2018, see T 247.17-.19).

8. Exhibit A1, Tab 23.

9. Exhibit A1, Tab 20.

10. Exhibit A1, Tab 21.

11. Exhibit A1, Tab 19 at 1085 to 1103.

12. Exhibit A1.Tab 24

3. The Defendant relied on the affidavit of Steven Charles Davis dated 19 July 2019. [13] Mr Davis was a powder coating operator and Director of the First Defendant. The Defendants also relied on an affidavit of Anthony David Nugent, [14] Director of the Second Defendant who was the owner of Lots 5 and 6 of the Strata Plan. Both Messrs Davis and Nugent were also called to give oral evidence. The Defendants also relied on a report of Ms Nicola Power Occupational Hygienist dated 13 August 2019. [15] Ms Power also gave oral evidence.

   13. Exhibit A1, Tab 11.

   14. Exhibit A1, Tab 13.

   15. Exhibit A1, Tab 25.

4. For reasons which appear in the transcript I declined to allow the Plaintiff to rely on a further affidavit of Mr Barrett dated 12 March 2020 [16] and the Defendants to rely on the further affidavit of Mr Davis dated 9 March 2020. [17]

   16. T 23.41-25.47.

   17. T 2.44-8.39.

Background

5. The proceedings concerned a property located at 55-59 Wheelers Lane, Dubbo. [18] It makes up Strata Plan No. 72250. [19] Prior to 2004, it was owned by Double Bay Newspapers, General Newspapers Pty Ltd and Brehemer Fairfax Pty Ltd. In or about 2002 or 2003, Hannan Print granted an option to Mannu Holdings Pty Ltd to purchase the Property. Mannu Holdings decided to subdivide the Property and create a strata scheme on the Property, to be divided into twelve lots. [20] The strata scheme was registered in 2004 and on 8 May 2004, each individual lot owner settled the purchase of each lot of the entire complex. [21] According to Mr Barrett, the building of the Property commenced at some time in the 1980s and the roof to the various lots was built at that time. [22]

   18. Hereinafter referred to as “the Property”.

   19. Hereinafter referred to as “the Strata Plan”.

   20. Exhibit A1, Tab 6 at 37, [6].

   21. Exhibit A1, Tab 6 at 39, [13].

   22. T 53.33-.38.

6. Mr Davis started working in the blasting and powder coating industries in 1992 in Dubbo. [23] The First Defendant was established in 1993 and traded under the name of Dubbo Powder Coating. [24]

   23. Exhibit A1, Tab 11 at 559, [5]-[6].

   24. Exhibit A1, Tab 11 at 559, [7]. Dubbo Powder Coating hereinafter referred to as “DPC”.

7. Mr Gene Barrett became elected chairperson and secretary of the Plaintiff on 27 January 2015. Prior to that date, the Plaintiff did not have a chairperson, secretary or executive, but Mr Barrett stated that he was responsible for organising maintenance of the common property of the Plaintiff. [25] It was not in issue that Mr Gene Barrett and the other entities he controlled, collectively owned Lots 7-12 of the Wheeler Lane complex. Lots 1, 2 and 3 were owned by Mr Gene Barrett’s parents Geoffrey (also known as Geoff) and Chau Barrett via various entities. [26]

   25. Exhibit A1, Tab 6 at 37, [1].

   26. Exhibit A1, Tab 6 at 38, [8].

8. In or about late 2003, Mr Nugent and his wife Christine Nugent managed to purchase part of the Wheeler Lane complex. [27] Lots 5 and 6 were purchased in the name of the Second Defendant, and Lot 4 was purchased in the name of Mr and Mrs Nugent. [28] That position continues at the present time. [29]

   27. Exhibit A1, Tab 13 at 788, [6].

   28. Exhibit A1, Tab 6 at 38, [8].

   29. Exhibit A1, Tab 13 at [9].

9. Mr Nugent operated the business known as “Makin” Mattresses” in Lot 4 and part of Lot 5 of the Wheeler Lane complex in late 2004 to mid-2013. [30]

   30. Exhibit A1, Tab 13 at 792, [35].

10. Mr Nugent gave evidence that prior to 2004, a large magazine and printing business operated at the Property and that large commercial printing presses had been installed. He stated that he understood that the presses were huge, about the size of a locomotive, and they were situated in the part of the complex now Lots 5 and 6. Mr Nugent further stated that there were sections of the concrete floors in those areas that had extra thick reinforcing where presses appeared to have been located. [31] Mr Gene Barrett conceded that there were printing presses there prior to 2004 [32] with the previous occupant of what was Lots 5 and 6 using them for its newspaper works. [33]

    31. Exhibit A1, Tab 13 at 790 [19]-[22].

    32. T 53.22-.31.

    33. T 70.50-71.01.

11. Mr Nugent recalled inspecting the complex on a number of occasions in late 2003 and mid-2004 and observing black dust lying everywhere through the premises, on the floors, walls and up in the roofing areas where he looked up. He observed that the dust appeared to be quite thick in most areas, up to 20-30mm in depth. [34] He further recalled walking around the complex during his inspections and observing that it was it was very dusty and dirty, with dust was swirling around as wind blew in the door. [35] Mr Gene Barrett stated that he was not aware of any black dust at the time he, his father and their companies became owners and denied that either Mr Nugent or Mr Davis informed him of this. [36]

    34. Exhibit A1, Tab 13 at 790-1, [21]-[23].

    35. Exhibit A1, Tab 13 at 791, [25].

    36. T 71.04-.20.

12. Mr Nugent further gave evidence that around the time he was arranging to purchase his interest in the Property, he was informed by Mr Davis that his business was growing and he needed a new set of premises to expand. [37] Mr Nugent stated that he advised Mr Davis that he was looking into purchasing at the Property. Thereafter, a number of discussions took place about Mr Davis leasing part of the Property that Mr Nugent would buy and relocating his powder coating business there. [38]

    37. Exhibit A1, Tab 13 at 789, [11].

    38. Exhibit A1, Tab 13 at 789, [12].

13. On a date that he could not recall, but was on a date in late 2003 or early 2004, Mr Nugent had a conversation with Mr Geoff Barrett in which he informed him that he was looking at bringing Mr Davis in as a tenant when he bought his lots in the Property. Mr Nugent’s evidence was that Mr Geoff Barrett sought to have Mr Davis take up tenancy in another part of the complex that he owned. Further, that he inspected Mr Davis’ previous premises to look at its operations. [39]

    39. Exhibit A1, Tab 13 at 790, [15]-[17].

14. According to Mr Nugent, he had made observations of DPC’s previous premises and observed that they were clean, did not appear to be overly noisy and Mr Davis’ workers appeared to be happy. He stated that based on these observations he assumed that there would be a similar sort of operation at the Property. [40]

    40. Exhibit A1, Tab 13 at 791, [31].

15. On 2 June 2004, the Owners Corporation held what has been described as a First Annual General Meeting. [41] The Minutes of that meeting largely comprise of the passing of formal motions. [42] In attendance were Mr Nugent, Mr Geoff Barrett and Mr Gene Barrett. Those Minutes appear to be signed by Mr Gene Barrett and record:-

Dubbo Powder Coating & Sandblasting would submit DA to Body Corporate at earliest possible notice.

Mr David Nugent (Leaser to tenant) has assured that the DA would be produced as soon as possible. Also, he has verbally assured the Body Corporate that there would be no implications from the tenant regarding noise levels and trade waste issues. [43]

41. Exhibit A1, Tab 6 at 39, [17]; Exhibit A1, Tab 13 at 791, [27].

42. Exhibit A1, Tab 7 at 86; Exhibit A1, Tab 14 at 841-842.

43. Exhibit A1, Tab 7 at 86.

16. In cross-examination Mr Barrett stated that his recollection of the assurances given at the meeting of 2 June 2004 was limited to noise and trade waste issues. [44]

    44. T 68.33-69.22

17. According to Mr Nugent, during the meeting Mr Geoff Barrett asked “How much noise will Steve Davis’ powder coating business make? Will it be a problem?” to which Mr Nugent replied “I don’t think so. He seems to run a good show in Douglas Mawson Road.” Mr Nugent stated that he did not recall Mr Geoff Barrett discussing or raising with him either prior to or at the meeting of 2 June 2004, any issues about dust being generated by DPC’s business. [45] Nevertheless in cross-examination he conceded that Mr Geoff Barrett raised concerns with him about the powder coating business going into Lots 5 and 6. Beyond rejecting a number of suggestions as to the concerns raised, Mr Nugent did not identify what the concerns actually were. [46]

    45. Exhibit A1, Tab 13 at 791, [30] and [32].

    46. T 181.14-.43

18. Mr Gene Barrett stated that immediately after the first AGM, a further meeting was held in the nature of an extraordinary general meeting. Mr Gene Barrett stated that at that meeting his father, who at the time was the owner of Lot 1 and the managing director of Mannu Holdings which owned Lots 2 and 3, expressed reservations about the powder coating business’ exhaust and filtration. [47] The Minutes of that extraordinary general meeting record prepared by Mr Gene Barrett record:-

New tenants    Dubbo Powdercoating & Sandblasting would submit DA to Body Corporate at earliest possible notice

Motion              Mr David Nugent (Leaser to tenant) has assured that the DA would be produced as soon as possible. Also, he has verbally assured the                               Body Corporate that there would be no implications from the tenant regarding noise levels and trade waste levels. [48]

47. Exhibit A1, Tab 6 at 39, [17].

48. Exhibit A1, Tab 7 at 86; Exhibit A1, Tab 14 at 841.

19. Following 2 June 2004, Mr Nugent stated that he was busy with his mattress business. He stated that he used Lot 4 as a show room and Lot 5 for the manufacturing area. [49] He gave evidence that he recalled during the second half of 2004, he regularly observed black dust on the floor and walls of Lots 4, 5 and 6. On occasions where he opened the doors to Lot 5 he observed dust being blown around by wind coming in the door.

    49. Exhibit A1, Tab 13 at 792, [33]-[34].

20. Mr Nugent recalled that during the second half of 2004, he was repeatedly mopping and cleaning the floors in Lot 4 and 5 to remove the black dust. He continued to observe from time to time that when wind blew into the premises, it would dislodge more of the black dust from wherever it was lying and send it swirling out over the floor, and he would have to mop the floor again to remove it. For many years after 2004, he stated he regularly observed black dust lying around the premises which looked like the black dust he had previously observed in the premises when he first purchased them. However, he also observed that the amount of black dust lying around the premises diminished over time and at present the premises are relatively clean compared to when he first purchased them. [50] In cross-examination Mr Nugent admitted not having photographs of the black dust, stating that it was nevertheless his diligent clear recollection. [51] He rejected the suggestion that there was no black dust on the premises. [52]

    50. Exhibit A1, Tab 13 at 792, [36]-[38].

    51. T 211.29-.49.

    52. T 212.24-.44.

21. A development application in relation to DPC was submitted to Dubbo Council dated 11 August 2004 with the Plaintiff’s consent. [53] According to Mr Davis, the application was approved in late 2004. Mr Davis stated that he recalled between mid-2004 and end of 2004, he visited the premises on many occasions before operating his business and observed that the premises were very dirty and dusty with lots of fine black dust on the floor and surfaces throughout. [54] He stated that when wind blew onto the premises, especially from the big door at the western end of Lot 6, he observed black dust would lift up and move around in the air. [55]

    53. Exhibit A1, Tab 12 at 653-4.

    54. Exhibit A1, Tab 11 at 600-1, [18]-[19].

    55. Exhibit A1, Tab 11 at 601, [20].

22. Mr Davis stated that in late 2004 or early 2005, he installed and set up DPC’s equipment in the workshop area and in or about early 2005, after the installation was complete, DPC began to operate from the Property. [56] Mr Gene Barrett indicated that although he could not recall precise dates, he believed it to be shortly after the first AGM and around mid-2004. [57]

    56. Exhibit A1, Tab 11 at 601, [25]; Exhibit A1, Tab 13 at 792, [41].

    57. Exhibit A1, Tab 6 at 41, [27].

23. Initially there was no lease between the Defendants, but a five year lease was executed on 1 July 2014. [58]

    58. Exhibit A1, Tab 13 at 793, [42]; Exhibit A1, Tab 14 at 843-61.

24. A partition wall had been installed across Lot 5 between the respective businesses around the end of 2004. [59] According to the evidence, that wall was moved twice. Mr Nugent wrote on Exhibit B the location of the partition at the present time, [60] and stated that the wall on Lot 5 was moved to 6.5 metres to the west in 2016. [61] According to Mr Nugent, the partition wall did not seal off the two sections completely as there were gaps along the top, and he could hear DPC operating next door. [62]

    59. Exhibit A1, Tab 11 at 601, [26]; Exhibit A1, Tab 13 at 793, [43].

    60. T 180.21-.34.

    61. T 59.44-.49.

    62. Exhibit A1, Tab 13 at [43].

25. Mr Davis gave evidence that the workshop area was initially very dirty and required a lot of cleaning. He stated that he continued to observe black dust on the surfaces of the premises and in the cracks in the concrete floor. He stated that he believed this was the same black dust he had previously observed in the workshop area on other occasions before moving into the premises. During late 2004 and the early part of 2005, he stated that his employees spent of lot of time repeatedly sweeping and washing the floor over many weeks to remove the black dust. He estimated that for approximately six to twelve months after DPC moved in and began operating, he regularly observed more of the black dust continuing to appear and settle on the floor around the workshop area. He would clean the floor and then soon after he would observe more of the black dust. Sometimes he would wash the floor within a few days of the last wash. He repeatedly instructed his employees to sweep and mop this black dust but the floor washing didn’t completely remove all of the dust out of the concrete. Occasionally he observed drifts of the black dust on the floor if there was wind blowing in from the western roller door. In the early part of 2005, he recalled having conversations with Mr Nugent where he informed him there was “black dust everywhere”, and from time to time that he went into Mr Nugent’s area in Lots 4 and 5 and observed black dust on the floor in that area similar to the dust he observed in his own workshop. [63]

    63. Exhibit A1, Tab 11 at 602, [27]-[30].

19. On or about 4 July 2018, Mr Nugent stated that he attended the premises to be present during an inspection by the Plaintiff’s expert. He stated that he was introduced to Mr Blair and another gentleman’s name he could not recall. During the inspection he stated that they went up in a scissor lift to inspect fire detectors in the ceiling at the rear of the premises about 10m away from the sandblaster. He observed that the roof purlins were covered with a layer of dust approximately 5 to 10 mm thick. He observed that the dust was black in colour, and it appeared to be the same black dust that he had observed in the premises in 2004 and regularly observed during subsequent years as he earlier referred to. He stated that he pointed out the dust on the purlins to the gentleman in the scissor lift. [64]

DPC Business

64. Exhibit A1, Tab 13 at 804, [110].

Experience

27. According to Mr Davis, DPC’s business involved two main processes; abrasive blasting and powder coating. [65] He stated that he did not have any formal qualifications in abrasive blasting or powder coating and he learnt his skills and knowledge during the twenty eight years he has been in the industry. [66] So far as he is aware, Mr Davis stated there is no formal training or certification process for getting qualifications in abrasive blasting and in his experience, abrasive blasting is a skill learned on the job working in an abrasive blasting business. [67] He acknowledged, however, that it was possible to get qualifications in spray painting and protective coating from TAFE. [68]

    65. Exhibit A1, Tab 11 at 602, [32].

    66. Exhibit A1, Tab 11 at 603, [36].

    67. Exhibit A1, Tab 11 at 603, [37].

    68. Exhibit A1, Tab 11 at 603, [38].

28. Mr Davis stated that in the blasting industry there were two major suppliers in Australia: Abrasive Blasting Service & Supplies Pty Ltd [69] and Burwell Abrasive Blasting Equipment. [70] He stated he sourced most of his equipment from ABSS. This business had two representatives who he came to deal with on many occasions and that he knew quite well, being a Mr Joe Campagna and Mr John Bellato. [71] Over the years, he stated that he relied heavily on Mr Campagna, Mr Bellato and Dulux sales representatives to give him information about the equipment and products used in DPC’s business, including information about the safety aspects of the equipment and products. He described the representatives as his biggest source of safety knowledge and if advised there was a newer safety product that is better than one that DPC had previously used, it was his practice to make the switch. [72] Mr Davis stated that he is not aware of any regulatory body responsible for overseeing the abrasive blasting industry, and there is no peak industry of representative organisation for the abrasive blasting industry. [73]

    69. Hereinafter ‘ABSS’.

    70. Hereinafter ‘’Burwell’.

    71. Exhibit A1, Tab 11 at 603, [41].

    72. Exhibit A1, Tab 11 at 604, [44]-[45].

    73. Exhibit A1, Tab 11 at 603, [35].

Workshop layout

29. According to Mr Davis, the workshop he established was originally set up in accordance with 2004 floorplan. [74] However in or about 2015, he and Mr Nugent agreed for the partition wall across Lot 5 at the eastern end of his workshop to be moved about six metres to the west, and Mr Nugent arranged for the wall to be moved. This reduced DPC’s total workshop floor space by approximately 160 to 170 square metres. [75]

    74. Exhibit A1, Tab 11 at 604, [49]; Exhibit A1, Tab 12 at 693-695.

    75. Exhibit A1, Tab 11 at 604, [51].

30. In 2016, he decided to stop using the blast room in the south-western corner of the workshop and installed a new blast room in the north-eastern corner. He stated that the blast pot and dust extraction system located next to the new blast room were purchased from ABSS. [76] The new floorplan was said to be as follows:- [77]

    76. Exhibit A1, Tab 11 at 604-5, [52].

    77. Exhibit A1, Tab 12 at 696.

31. According to his description, the 2016 Floorplan shows:-

1. The partition wall between the two parts of Lot 5 moved about six metres to the west compared to the 2004 floorplan;

2. The main blast room being located where the old acid baths used to be in the north-eastern corner of the workshop;

3. The distance between the fire protected tunnel on the northern wall and north-western corner of the blast room is about two metres; and

4. Along the rear eastern wall and next to the blast room is the ABSS blast pot and dust extraction system. [78]

The acid baths had been removed from the north-eastern corner of the workshop in 2007 or 2008. [79]

78. Exhibit A1, Tab 11 at 605, [54],

79. Exhibit A1, Tab 11 at 604, [50].

32. Following the installation of the ABSS room in 2016, Mr Davis stated that they used the old room for about a week in late 2017 when DPC was busy, but otherwise it was hardly used. He stated that in or about 2017, DPC sold the old room to another business and it has sat in his workshop the whole time waiting to be collected by the new owner. [80]

    80. Exhibit A1, Tab 11 at 615, [133].

33. According to Mr Gene Barrett, as part of the First Defendant’s fit out, it had three penetrations made in the roof sheeting for the exhaust systems of its sand blasting room, its powder coating room and its oven. There were issues with these penetrations in that they were not sealed properly and there were frequent problems with water leaking into the roof through the years. He stated that while the Owners Corporation did not consent to those penetrations being made, it did not raise them as an issue at the time as he and the others wanted to keep getting along with the Defendants and he believed they would address the issues given the assurance they had given. [81]

    81. Exhibit A1, Tab 6 at 41, [30]-[31].

34. In 2016 when the First Defendant reconfigured the layout of its operations by adding a new blast room, Mr Gene Barrett stated that the First Defendant created new penetrations in the roof sheeting and installed a new exhaust from its blast room located essentially directly above the blast room underneath an evaporative air conditioning unit fixed to the roof. [82]

    82. Exhibit A1 Tab 6 at 45, [46]-[47]

35. Mr Davis conceded that in 2004 or 2005 when DPC installed its equipment, it was necessary to install vent penetrations from the dust extraction units and curing oven to the outside air. Further, in 2016 when ABSS installed the new room it was necessary to install a vent penetration from the dust extraction unit known as the Dustech Unit. [83] Mr Davis stated that the penetrations were sealed properly. [84]

DPC’s Processes

83. Exhibit A1, Tab 11 at 628, [232].

84. Exhibit A1, Tab 11 at 632, [256(b)].

Abrasive blasting

36. According to Mr Davis, abrasive blasting is a process used to clean surfaces including the removal of rust and paint prior to them being used or, usually, being painted. Typically the items to be cleaned are made of steel or other metal. [85] The process involves using compressed air to blast an abrasive medium at high speed at the item being cleaned. [86] The abrasive medium or ‘grit’ is stored in a hopper called a ‘blast pot’, and compressed air sends the grit through a high pressure hose from the blast pot to a nozzle that is controlled by the operator. [87] The blasting process is then carried out by the operator in an enclosed room known as a blasting room or blast room. [88] The blasting is done by an operator working inside the blast room. The operator will point the blast nozzle at the item as if they are ‘hosing it down’ with the compressed air and grit, and they will continue to blast it until the metal surface is clear and clean, ready for powder coating. [89]

    85. Exhibit A1, Tab 11 at 605, [55].

    86. Exhibit A1, Tab 11 at 605, [57].

    87. Exhibit A1, Tab 11 at 605, [58].

    88. Exhibit A1, Tab 11 at 606, [59].

    89. Exhibit A1, Tab 11 at 606, [60].

37. Mr Davis stated that DPC used a garnet blast media known as almandite for the blasting process. This was described as a rough grit that is a deep reddish brown in colour and is purchased in one tonne bags from ABSS. [90] Mr Davis stated that on two or three occasions over the last ten years or so, DPC has purchased from Burwell a different garnet known as staurolite, which is similar to almandite but is slightly browner in colour. He stated that it had been three to four years since DPC had last purchased such a bag. [91] Mr Davis described that over the years he had regularly observed that the roughness of the finish on an item that had been blasted corresponds with the coarseness of the grit used in the blasting process. In short, as the coarseness of the grit increases, the finish of the blasted item becomes rougher. To avoid this, he stated that they usually mix some of the finer recycled grit with the coarser new grit to achieve an optimal mix for a top quality finish. He stated that he observed that the best finish of a blasted item is achieved when the ratio of new to recycled garnet is about one part new garnet to four parts old garnet, and the unit he has it set up to achieve this mix ratio. Accordingly, approximately 20% of the garnet in a cycle is said to be new garnet and the remainder is recycled garnet. [92] He stated that he has set the reclaimer (a reclaiming unit) so that approximately 80% of the garnet is to be recycled on each cycle with the remaining 20% breaking down into smaller particles and dust captured by the reclaimed waste. [93]

    90. Exhibit A1, Tab 11 at 607, [64]-[65].

    91. Exhibit A1, Tab 11 at 607, [68].

    92. Exhibit A1, Tab 11 at 611, [100]-[102].

    93. Exhibit A1, Tab 11 at 611, [103].

38. Mr Davis stated that the current blast room was supplied and installed by ABSS in early 2016. The supply and installation included a special floor to the blast room, the blast pot and the dust extraction unit attached to the ABSS Room.

39. The room was connected by ducting form the blast pot and ducting to the Dustech Unit which houses a reclaimer unit. The ducting between the blast pot, the blast room and the reclaimer was about 200 mm in diameter and is made of heavy duty industrial pressure hose. During the blasting process, the doors are closed and the room is sealed. Once the blasting process starts, the garnet is propelled by compressed air through the incoming ducting from the blast pot connected to the blast room and then through a smaller hose and nozzle held by the operator. The operator wears a sealed mask or helmet supplying oxygen from outside the room, together with other suitable protective equipment. [94]

    94. Exhibit A1, Tab 11 at 608, [76]-[78].

40. The leftover garnet, dust and residue removed from the cleaned item is extracted by a fan driven exhaust system connected to an extraction system under the grid floor located in the floor of the room. This type of floor is known as a W Section Pneumatic Floor. [95] The exhaust system will then suck or draw the garnet, dust and residue down through the pneumatic floor, throughout the outgoing ducting and back to the reclaimer. [96] The reclaimer is described as performing three functions, being to firstly screen and separate or wash the dust, garnet and residue through a cyclonic air system. Secondly, after the reclaimed garnet is cleaned it is then delivered from the reclaimer back into the blast pot located to be reused, while the dust and residue is separated and delivered into a sealed waste drum, located beneath what is described as the Dustech Unit. [97] Finally, any airborne dust is trapped in the cartridge filters in the reclaimer. The filters are then cleaned by the unit using a reverse pulse compressed air system. [98]

    95. Exhibit A1, Tab 11 at 608, [80].

    96. Exhibit A1, Tab 11 at 608, [81].

    97. Exhibit A1, Tab 11 at 609, [84]-[85].

    98. Exhibit A1, Tab 11 at 609, [86].

41. Mr Davis stated that once the doors to the blast room is shut, the blast pot is shut, the waste drum is sealed and the housing for the cartridge filler is shut, and there are no other parts of the blast room or Dustech Unit that are open to the surrounding air in the workshop except for the vent from the reclaimer through to the roof. He stated that he has not observed any other openings through which dust can escape to the air in the workshop. [99] When the doors to the blast room are shut and blasting is being done in the room, Mr Davis stated he has not observed any dust escaping from the blast room or Dustech Unit into the workshop. [100]

    99. Exhibit A1, Tab 11 at 609, [89].

    100. Exhibit A1, Tab 11 at 610, [91].

42. Mr Davis stated that he regularly observed that the remaining garnet that is not reclaimed and recycled is broken down into smaller particles and dust, captured as waste or dust in the reclaimer and delivered to the waste drum. [101] The dust residue and any waste such as paint, dirt and corrosion captured by the reclaimer including when the cartridge filters are automatically cleaned by the unit, is then deposited into a custom-made sealed forty-four gallon drum located below the unit. [102] When the waste drum is full it is removed, and it is emptied into a container which is then sealed. This occurred in the blast room so that any excess dust is able to be removed through the extraction system. [103] Mr Davis outlined a detailed process for waste removal to ensure that the dust that has been captured by the reclaimer is contained at all times and is not released into the atmosphere in the workshop. [104]

    101. Exhibit A1, Tab 11 at 611, [99].

    102. Exhibit A1, Tab 11 at 611, [104].

    103. Exhibit A1, Tab 11 at 611-2, [106].

    104. Exhibit A1, Tab 11 at 611-3, [106], [108] and [115].

43. Mr Davis referred to one of the hydraulic hose fittings under the blast pot through which garnet is conveyed includes a small rubber ‘O’ ring which he observed wears out in as little as two weeks due to the garnet as it goes through the fitting at high pressure and speed. He observed that a small amount of garnet could trickle through the fitting and accumulate on the floor underneath and this consisted of course grit and not dust. Based on his observations he estimated that the amount of garnet trickling through the fitting to be less than a cup full in an hour. As the wearing out of the ‘O’ ring affects the pressure coming through the blast nozzle inside the room, the fitting is checked every two to three days to ensure that it has not worn out and replacement supplies are kept to this end. [105]

    105. Exhibit A1, Tab 11 at 612-3, [110]-[114]

Dust extraction

44. The dust extraction unit connected to the blast room is known as a reverse pulse dust collector (the Dulsech Unit). [106] According to the information sheet in relation to the machine:-

The ABSS Dustech Dust Collector is a reverse pulse style that uses a pulse-jet of compressed air to clean the cartridge filters.

This allows for an extremely high dust collection efficiency and a longer life expectancy for the cartridge filters. [107]

106. Exhibit A1, Tab 11 at 608, [73].

107. Exhibit A1, Tab 12 at 705.

45. According to the report of Ms Nicola Power, occupational hygiene manager, the ABSS Dust Collector “captures the fine dust and foreign matter onto filters before the air is deducted to the exhaust on the roof of the premises.” [108] Ms Power also reports that the filters used in the reverse pulse dust collector are “Farr Gold Series Filters, which have 99.99% efficiency for particles of 0.5 micron and greater.” [109] The systems also have a reverse pulse dust collectors which automatically use compressed air to clear the air filters, such that they do not require regular manual cleaning. [110]

    108. Exhibit A1, Tab 25 at 1374-1375, [85].

    109. Exhibit A1, Tab 25 at 1376, [87].

    110. Exhibit A1, Tab 25 at 1381, [126(a)].

Burrell Unit

46. What was described as the old blast room in the south-western corner of the workshop was supplied by Burwell and installed in 2004. The dust extraction system was also supplied by Burwell and was referred to as the Burwell Unit. This also used a cartridge filter system similar to that used in the Dustech Unit. [111] Mr Davis stated that the process for operating the Burwell blast room and dust collector was essentially the same as that of the Dustech Unit. [112] This also appeared to have been confirmed by Ms Power in her report. She stated that the dust collector uses a frequent, automatic pulse jet of compressed air passed through educator tubes to ensure complete dust removal, regardless of the load of the filter, to clean the cartridge filters. [113]

    111. Exhibit A1, Tab 11 at 613, [116]-[118].

    112. Exhibit A1, Tab 11 at 614, [119].

    113. Exhibit A1, Tab 25 at 1378, [95].

Powder coating process

47. The powder coating process was described by Mr Davis in his affidavit. He stated that after cleaning an item by abrasive blasting, it is common to then powder coat the item, mainly to protect the metal surfaces from corrosion. [114] It was a process which involved electrostatically applying a dry powder polymer to coat the object and then curing it under heat in a curing room to allow it to form a protective coating or “skin” over the item. Mr Davis described the curing room as essentially a large industrial oven. [115] The powder coating was done in the power coating bay, known as a spray booth. After coating, an item would be transferred to one or two ovens for the curing part of the process. [116] The spray booth was described as a room with a very strong exhaust ventilation system. The operator stands inside the booth and uses a spray gun to spray the powder polymer over the item being coated. Any powder that comes into contact with the item sticks to the item due to the electrostatic charge on the powder. Any powder that doesn’t come into contact with the item being coated is extracted by the exhaust system. [117] Mr Davis stated that he regularly observed over the years that the velocity of the air in the spray booth exhaust equipment is very strong and more than sufficient to ensure any excess powder is drawn towards the closed end of the booth and to prevent powder settling in the booth. [118] The western end of the room is open and the exhaust system which is located outside the booth on the eastern side of the closed end of the booth. No items are sprayed outside the booth. [119] The spray booth extractor is described as having a cartridge filtration system with an automatic reverse pulse cleaning system and it operates in a very similar manner to the reclaimer unit described in relation to the ABSS system. [120] The reverse pulse cleaning timer is set to blast air every fifteen seconds, when a pulse of air is sent back in to clean the cartridge filters in the unit. [121]

    114. Exhibit A1, Tab 11 at 615, [134].

    115. Exhibit A1, Tab 11 at 615, [135].

    116. Exhibit A1, Tab 11 at 616, [139].

    117. Exhibit A1, Tab 11 at 616, [140]-[141].

    118. Exhibit A1, Tab 11 at 617, [144].

    119. Exhibit A1, Tab 11 at 616, [140].

    120. Exhibit A1, Tab 11 at 617, [147].

    121. Exhibit A1, Tab 11 at 617, [148].

48. The surplus powder extracted from the spray booth is captured by the dust extractor attached to the spray booth. That powder is not recycled, but is deposited by the unit into a bag in the sealed waste bin underneath the unit and disposed of as waste. [122] The product data sheet for the dust filter described a Gold Cone in the centre of the cartridge stating:-

…cleaning is accomplished by pulse waves that emanate outward from this inner cone providing enhanced cleaning for more efficient operation, longer cartridge life and reduced service requirements. [123]

122. Exhibit A1, Tab 11 at 617, [149].

123. Exhibit A1, Tab 12 at 739.

49. The cartridge filters for the Dustech Unit, the Burwell Unit and the dust extraction unit connected to the spray booth were said to all use the same cartridge filters. [124]

    124. Exhibit A1, Tab 11 at 620, [171].

50. Mr Davis stated that he regularly observed the waste bin under the spray booth extractor required emptying once every 1 to 2 weeks depending upon the amount of coating that is done in that timeframe. He stated that he would check the bin at least once per week, and sometimes more frequently if a heavy volume of coating had been done, to see if it required emptying. If the process of emptying occurs, the unit requires switching off and the waste requires disposing of. Mr Davis could not recall any of the waste bags being broken or releasing dust into the atmosphere, though he had observed a waste bag being dropped on the floor and splitting, spilling powder on the floor but without causing dust to rise up into the air. [125]

Filtration System Failure

125. Exhibit A1, Tab 11 at 617-8, [150]-[152].

Gene Barrett

51. Mr Gene Barrett provided evidence that since the First Defendant first started operating its powder coating operation in 2004, there had been issues with noise, as well as dust and paint residue drifting into neighbouring lots and onto the roof sheeting. [126] He recalled a fine, pinkish or grey and red sand like substance being present on the roof sheeting and guttering which was collecting in concentrated deposits where the sand blasting exhaust port was located. [127] From 2008 onwards, he also saw these substances being present in neighbouring lots, particularly Lots 2, 3, 5, 7 and 10 which were adjacent to DPC. [128] He stated that he first saw these substances on the roof and in neighbouring lots in or around 2008. From then onwards, what he described as “the Residue” continued to accumulate on the roof generally, but was concentrated in larger deposits near the respective exhaust ports in Lots 5 and 6. He stated that the Residue collected in deposits from the exhaust ports down the roof sheeting and into and down the gutter, but also drifted across a wider area of the roof structure. Mr Gene Barrett stated that it drifts from the new exhaust port from the new sand blasting room in the North Eastern Corner of the powder coaters’ premises. He stated he also observed it constantly drifting and being present in neighbouring lots. [129]

    126. Exhibit A1, Tab 6 at 41, [34].

    127. Exhibit A1, Tab 6 at 42, [38].

    128. Exhibit A1, Tab 6 at 42, [39].

    129. Exhibit A1, Tab 6 at 42, [40].

52. Mr Gene Barrett described that directly under the exhaust port for the original blast room, the roof sheeting had rusted, an observation he made about five years ago. [130]

    130. Exhibit A1, Tab 6 at 42, [41].

53. Mr Gene Barrett added that at various general meetings of the Plaintiff (discussed below) he raised the issue of the dust from the powder coating business drifting into neighbouring lots and onto the roof and causing damage with Mr Nugent, however, the problem persisted. [131]

    131. Exhibit A1, Tab 6 at 42, [42].

54. Exhibited in an annexure to his affidavit were photographs of the Residue on the roof structure and other locations between 2 October 2013 and 14 May 2018. [132]

    132. Exhibit A1, Tab 6 at 43-4, [44].

55. Mr Gene Barnett stated that the Residue caused damage to three sections of box guttering above the boundary between Lots 6-3, 6-10 and 5-2 and 5-7 and over the last five years parts of the box gutters have rusted out and the Owners Corporation replaced them as required. This evidence was limited under s 136 of the Evidence Act 1995 (NSW) [133] to his perception. [134] Mr Barrett stated that because of the residue the Owners Corporation had to have the roof and guttering cleaned more frequently than it otherwise would have. He further observed that the amount of Residue on the roof would reduce the further away you got from the exhausts. [135]

    133. Hereinafter ‘the 1995 Act’

    134. T 20.27-21.14.

    135. Exhibit A1, Tab 6 at 45, [45].

Steve Davis

56. On one occasion in 2014, Mr Davis conceded that he went and observed that dust and grit was coming through the blast nozzle into the blast room. He then shut down the system and began investigating the cause of the problem. Upon inspection of the Burwell Unit, he discovered that one of the cartridge filters had a hole in it and was damaged, and that dust had gone up into the vent that went to the roof. Thereafter, the room was not used until a replacement filter was installed one or two days after it was ordered. To the best of his recollection, Mr Davis stated that the failure of the cartridge filter on the Burwell Unit was the only occasion that it had been damaged and required replacement since DPC commenced operating at the Property. To the best of his recollection, Mr Davis stated that he did not believe that the Burwell Unit and the old room broke down at any other time after 2004 nor was dust allowed to escape into the atmosphere inside or outside the workshop. Since 2016 following the installation of the ABSS room, the old room was used for about a week in later 2017 when they were very busy but otherwise it was hardly used and in 2017 it was sold. [136]

    136. Exhibit A1, Tab 11 at 614-5, [126]-[133].

57. On a further date he could not recall approximately six to seven years ago, Mr Davis stated that there was a breakdown of the filter in the spray booth extraction unit. This resulted in a release of waste through the roof. He stated that he climbed on the roof, observed that in the area around the vent there was whitish powder about two inches deep spread out over an area measuring approximately three or four metres by three or four metres. He then arranged for his employees to help him clean it up and they were able to sweep most of the powder up and dispose of it. According to the best of his recollection, he believed that the spray booth extraction unit has not broken down at any other time since 2004 nor has powder been allowed to escape into the atmosphere inside or outside the workshop. [137]

    137. Exhibit A1, Tab 11 at 618, [152]-[157].

58. Mr Davis conceded that he had also been up on the roof of Lots 4, 5 and 6 on a number of occasions since the incident of 2013/14. He stated that during each of the inspections he observed:-

1. There was some residue on the roof in the same location that he cleaned up seven or eight years ago and which appears to be residual powder that was not removed at the time;

2. That powder residue was grey in colour and range from about 1 to 3 mm in thickness; and

3. The powder residue appeared to be powder coating that had been baked by the sun where it was lying. [138]

   138. Exhibit A1, Tab 11 at 629, [234]

59. Mr Davis stated that he observed that the powder residue was quite easy to remove and the roof line underneath had not corroded and appeared to be undamaged as a result of being covered with powder residue. [139]

    139. Exhibit A1, Tab 11 at 629, [235]

60. Mr Davis added that the powder coated items are finished in the curing ovens. The only by-product of the curing process is the release of surplus heat from the oven directly into the open atmosphere through a roof vent to the exterior of the building. Mr Davis stated that he has not observed any powder or dust being given off an item or generated through the curing process. [140]

    140. Exhibit A1, Tab 11 at 619, [162].

61. In cross-examination Mr Davis conceded that Gene and Geoff Barrett possibly raised with him the drifting of dust from DPC but didn’t recall it being in relation to neighbouring lots. He denied that they raised with him damage to the roof above DPC and rusting because of run off from the dusting garnet. [141]

    141. T 157.30-.48.

62. Mr Davis conceded that he didn’t have any documents for procedures to prevent interaction of dust from powder coating and maintenance. [142]

    142. T 163.19-.44.

David Nugent

63. Mr Nugent recalled being informed by Mr Davis in or about 2013 or 2014 that one of the filters in his blasting room had broken and had been replaced but could not recall any further specific details of the incident. [143]

    143. Exhibit A1, Tab 13 at 797, [72]

64. He stated that on each of the two occasions when Mr Davis’s equipment broke the equipment was on his belief promptly repaired or replaced. He was not aware of any other incidents when the blasting or powder coating equipment has broken down since he commenced operating in the premises in 2004. [144]

Fire Alarms

144. Exhibit A1, Tab 13 at 797, [73]

Gene Barrett

65. Apart from damage to the roof, Mr Gene Barrett stated that from the time the First Defendant started operating its powder coating business, the number of false alarm charges being triggered by detectors in Lot 6 and the portion of the business occupied in Lot 5 had been disproportionate to other lots. He also stated that there were fire alarms triggered by detectors in lots around the powder coating business that were near the boundary of the powder coater where there had been no activity in the lot in which the detector was located that would apparently cause the alarm. On each occasion that a false fire alarm occurred, Fire and Rescue NSW were said to have attended the premises and invoiced Romteck Grid, which in turn invoiced the Owners Corporation for the callouts. [145] These invoices from Romteck from 6 January 2011 were exhibited to Mr Barrett’s affidavit. [146]

    145. Exhibit A1, Tab 6 at 46, [50]-[52].

    146. Exhibit A1, Tab 7 at 193-280.

66. According to Mr Gene Barrett, the main panel of the fire detector system provided for a log of previous fire alarm indications at a given date, however the history gets deleted and you could only capture so many at a given time. The fire detections manager, Orana Fire Protection, did not conduct monthly checks nor did it retain a record of history for that month. However, Mr Gene Barrett did exhibit to his affidavit a record from the main panel of the fire detection system showing the raw data of fire alarm triggers for the periods 5 November 2012 to 27 November 2012; [147] 23 March 2015 to 12 December 2016; [148] 20 February 2017 to 1 May 2017; [149] and from 9 May 2018 to 7 June 2018. [150] The detectors alarms contained in the history logs are then able to be matched against the fire system plan, with L being a reference to loop and D being a reference to the detector. The fire system plan was tendered as Exhibit B. Exhibited to Mr Gene Barrett’s affidavit was a spreadsheet prepared by Romteck, which had been produced by them under subpoena based on data from Fire and Rescue NSW, which showed the fire alarms in the complex and charges from 2005 to 31 May 2018, enabling the detectors to be matched against the plan. [151]

    147. Exhibit A1, Tab 7 at 281-286, noting that there are sporadic references to dates outside of this period prior to 2012.

    148. Exhibit A1, Tab 7 at 287-292.

    149. Exhibit A1, Tab 7 at 293-321.

    150. Exhibit A1, Tab 7 at 322-325.

    151. Exhibit A1, Tab 7 at 326-332.

67. Mr Gene Barrett was cross-examined in relation to each of the invoices forwarded by Romteck Grid attached to the Fire and Rescue NSW management system billing advice. Mr Gene Barrett accepted that there was nothing in the Fire and Rescue NSW invoices that identified the alarms going off in Lots 5 and 6. [152]

    152. T 75.01-.04.

Orana Fire Protection

68. Tendered in the Defendant’s case was a letter from Michael Theris of Orana Fire Protection for the attention of Sean Josephs, dated 12 June 2010. This stated:-

The false alarms at 55 Wheelers Lane, Dubbo, are mainly due to the detectors being contaminated with paper and… ink dust. As this building was an old printing factory and the detectors are mainly smoke detectors. The owners of the building have spared no cost in trying to keep the false alarms down to a minimum. The detectors are checked and cleaned regularly by Orana Fire Protection. All offending detectors are replaced with new.

The detection system allows us to check each detector for contamination. Other than the dust issues detectors have been going into alarm when there are new tenants and the system changed to suit the new environment, for example Dubbo Powder Coaters had all their detectors removed and changed to thermal detectors and more detectors were needed to comply. We hope this may explain the false alarms on site and possibly allow for a refund for some of the call out fees. [153]

153. Exhibit A1, Tab 14 at 862.

69. In further correspondence to Mr Josephs dated 30 April 2012, Mr Theris stated:-

The false alarms at 55 Wheelers Lane, Dubbo, are mainly due to the units of the building having undergone a change of use, for example, units with trucks driving in and out causing false alarms. These detectors were changed immediately to thermals. 55 Wheelers Lane, Dubbo is an old building which was used as a printing factory for many many years and this use has left ink dust particles throughout the building contaminating the detectors and causing them to go into alarm. We now, each month, check the status of the detectors. There has also been water damage causing detectors to go into alarm. These leaks have been repaired and the detectors replaced. The owners of the building have spared no cost in trying to keep the false alarms down to a minimum. The detectors are checked and cleaned regularly by a Orana Fire Protection. All offending detectors are replaced with new. [154]

154. Exhibit A1, Tab 14 at 863.

70. There was evidence that Mr Sean Josephs worked for Romteck. The aforementioned letters reference to dust being present was said by Mr Nugent to accord with his own understanding of the presence of black dust through the premises as earlier referred to. [155]

    155. Exhibit A1, Tab 13 at [58] Restricted pursuant to s 136 of the 1995 Act to Mr Nugent’s understanding

71. Also tendered in the Plaintiff’s case was a document produced on subpoena by Orana Fire Protection addressed in respect of the Property dated 13 December 2016, although the author is not identified. The letter states:-

Upon inspection of the above site, I found that the fire alarm system is going into false alarm into different areas but mainly at the Powder Coaters and the old Latex Factory. The detectors in the powder coating area must be replaced. They have deteriorated to the point where they are not indicating on the detector bases. The other issues are that activities at the powder coaters are setting the detectors off and also detectors in the tenants next door to them. The walls must be extended so contaminants created by the powder coaters do not intrude into the areas next door and set them into alarm, as is happening at the moment.

We suggest that all of the detectors in the powder coaters be replaced with Acclamate type detectors which need both heat and smoke before they will go into alarm. These detectors have the ability to be split into two where the smoke alarm can activate a local alarm and smoke and heat can activate the brigade alarm. The other option is flame detectors. Due to the aggressive environment, the Acclamate detectors will deteriorate and may need to be replaced within five years to ensure that contamination does not effect the detectors… [156]

156. Exhibit G.

72. In response to a request from Mr Nugent, Mr Michael Theris of Orana Fire Protection corresponded on 11 April 2017:-

Attention: David

In response to below.

Sensors were going into alarm and could not be identified as they had deteriorated and the indicator lights were no longer showing. The fire panel was showing powder coaters and the offending detector, however, no indicator lights were showing on the detector. The fire board replaced in the panel has nothing to do with monitoring but more with detection of alarms. The old board still worked fine but was also deteriorating and we were having trouble connecting to the laptop.

The dirt from the old printing factory is an issue, however was not the issue with alarms going off in the powder coaters. At one stage it was each and every time that the oven doors were opened which is odd as the detectors have not been moved. Therefore it would indicate that the ovens have been moved though Steve tells me that they haven’t. The detectors around the site, except for your areas, are cleaned on a regular basis as the panel indicates how contaminated the detectors are.

The brigade have never contacted us prior to attending site. When they get a call-out from a monitoring company whether you ring and tell them that it is a false alarm or not, they attend. We have not had a false alarm since the work was done. The detectors above the oven doors, which were causing the alarms, have been removed. There was one alarm caused by burning oil which I am led to believe was in pipework which caught alight and caused smoke when put in the oven. Steve tells me that this is a one off situation and that this has never happened before.

Most industrial settings would not effect detectors, however, detectors in aggressive areas would be affected. The powder coaters would be considered an aggressive environment. I did not witness any negligence or bad practice, it is just the environment associated with powder coating. [157]

157. Exhibit A1, Tab 7 at 349.

David Nugent

73. Mr Nugent stated, based on his observations of occupying the neighbouring lot, that throughout the period between 2004 and 2013 he recalled occasions when the fire alarm system in the complex was triggered, the alarms sounded loudly and everyone exited their premises to the outside of the complex. Mr Nugent estimated that during usual working hours he heard the alarms triggered at the complex on between approximately five to ten occasions in each year. He understood that the alarms were tested from time to time and that he believed that the majority of the alarms that he heard during the period from 2004 and 2013 were caused by routine testing. [158]

    158. Exhibit A1, Tab 13 at 812, [137].

74. In cross-examination, Mr Nugent rejected the suggestion that alarms were going off due to the dust contaminants in the alarms. [159] Mr Nugent rejected the suggestion that during the period between 2016 and 2017 the fire alarms were going off due to construction works being carried out in the premises. [160] He stated that he wouldn’t classify the moving of the wall in Lot 5 as construction. He stated that the wall was already there and it just had to be slid along one bay. [161] Mr Nugent agreed that the fire alarms increased significantly in 2016, but had no reason to understand why they were going off. [162] Mr Nugent disagreed with the suggestion that the reason he paid Orana Fire Protection to replace the fire detectors in February 2017 was because construction was causing dust in the alarm system. He stated that the reason was that the alarms kept going off and he couldn’t find out what was causing it so he therefore asked Orana Fire Protection to fix it and that he would pay for it. [163] He disagreed with the suggestion that the invoices for the maintenance work carried out by Orana Fire Protection was due to the presence of garnet and suggested that it was normal maintenance of the fire system which needed to be cleaned everywhere as part of the maintenance schedule. [164]

    159. T 204.02-.04.

    160. T 205.15-.17.

    161. T 204.14-.20.

    162. T 204.44-.50.

    163. T 205.42-206.01.

    164. T 206.17-.29.

Steve Davis

75. Mr Davis stated that he recalled that since 2004 and 2005, the fire alarms throughout the complex went off on regular occasions and he would hear sirens go off. He recalled that on some of those occasions that the fire brigade would attend the workshop to respond to an alarm, but they were false alarms as they had not had a fire in the workshop before. [165] He recalled that in early 2017, Mr Nugent informed him that Orana Fire Protection would be installing some new detectors in the workshop. After they had been replaced, he recalled that the fire alarm was triggered on two or three occasions and the fire brigade attended the workshop, but there wasn’t any fire on those occasions and these alarms were false. [166]

    165. Exhibit A1, Tab 11 at 631, [245].

    166. Exhibit A1, Tab 11 at 631-2, [247] and [250].

76. In the course of cross-examination, Mr Davis recanted from his claim that the fire alarms had been going off since 2004-2005 on a regular basis. He added that that was a mistake and that it would have been some date three to four years previously. [167] He specifically rejected that the fire alarms were triggered due to the presence of garnet in the detectors, [168] and disagreed that the fire alarms not on his premises went off because of garnet in the neighbouring lots. [169]

    167. T 168.34-.42.

    168. T 168.44-.48.

    169. T 168.50-169.09.

Meetings of the Lot Owners

77. On 2 October 2013, the Owners Strata held an extraordinary general meeting to discuss the issues including dust and damage to the roof of the Owners Strata. [170] In attendance were Mr Gene Barrett and Mr Nugent. The Minutes record:-

    170. Exhibit A1, Tab 6 at 42, [42]; Exhibit A1, Tab 13 at 795, [65].

Item 5

Dubbo Powder Coating and Sandblasting Dust

The dust from Powder Coating is still a problem although not as bad as two years ago. At least 20 smoke detectors need replacing; the box gutter and roof has a layer up to 30mmm thick in and around the Powder Coating walls and neighbouring floors also.

Motion: New filters be installed, maintenance and cleaning log be kept and that Body Corporate can inspect these logs.

Motion passed – unanimous. David Nugent will settle the dust with Steve Davis (Dubbo Powder Coating and Sandblasting) [171]

The Minutes further record:-

David requested the skylights over unit 6 be replaced. Gene stated the current skylights need to be cleaned of Powder Coating dust as well as the adjoining trim deck metal sheeting. The skylights would be replaced and quotes presented to the Body Corporate only after Powder coating dust problem (item 5) is resolved. [172]

171. Exhibit A1, Tab 14 at 867.

172. Exhibit A1, Tab 7 at 156; Exhibit A1, Tab 14 at 868.

78. According to Mr Nugent, although the Minutes did generally accord to his recollection of the meeting, they did not accord with his recollection of the discussion about DPC recorded at item 5. Nor did he recall there being any motion voted or passed in relation to DPC and he did not recall any discussion about maintenance and cleaning logs. Instead he recalled a conversation to the following effect:-

Gene: Dubbo Powder Coating has released dust on the roof and it’s everywhere

Me: I understand from Steve that one of the filters broke and it let some powder escape

Gene: Can you speak to Steve about it?

Me: He’s told me that the filter is fixed and the powder has been swept up but I’ll check with him straight after this.

Gene: Thanks David. [173]

173. Exhibit A1, Tab 13 at 796, [68].

79. The version of the Minutes produced by Mr Gene Barrett shows that they had been signed as a true and correct record both by Mr Gene Barrett and Mr Nugent. [174] For an unknown reason the copy of the Minutes exhibited to Mr Gene Barrett’s affidavit is missing the relevant page containing Item 5. [175] Mr Nugent was cross-examined about his signature appearing on the Minutes under “signed as a true and correct record”. Whilst Mr Gene Barrett’s copy had signatures, [176] Mr Nugent’s copy did not. [177] Notwithstanding this, Mr Nugent maintained that in this respect the Minutes did not accord with his recollection. [178] In cross-examination Mr Nugent denied that he knew the dust and the powder coating at DPC was an issue at the time. [179]

    174. Exhibit A1, Tab 7 at 156.

    175. T 192.39-.43.

    176. Exhibit A1, Tab 14 at 868.

    177. Exhibit A1, Tab 7 at 156.

    178. T 190.11-192.17.

    179. T 193.15-.17.

80. After the meeting of 2 October 2013, however, Mr Nugent did recall going to the factory area and not observing any dust or damage coming through the gap at the top of the partition wall. He stated that he spoke to Mr Davis and told him that Mr Gene Barrett had asked him to check that the filter was definitely fixed and the powder wasn’t continuing to come to the roof. He said he was assured by Mr Davis that they had definitely replaced the filter and cleaned it. [180]

    180. Exhibit A1, Tab 13 at 797, [70]-[72]

81. Mr Gene Barrett referred to the First Defendant reconfiguring the layout of its operation in 2016. This was due to a new tenant in Lot 4 utilising more of Lot 5 than before. A copy of the reconfigured Lot was marked by Mr Gene Barrett. [181]

    181. Exhibit A1, Tab 6 at 45, [47]; Exhibit A1, Tab 7 at 192.

82. On 5 August 2016, the Owners Strata held an Annual General Meeting where issues of dust and damage to the roof of the Owners Strata were discussed. At that meeting, both Messrs Gene and Geoff Barrett and Mr Nugent were present. The Minutes record that there was a discussion about noise and dust complaints about DPC and there was a decision to bring this up at the upcoming EGM. [182]

    182. Exhibit A1, Tab 6 at 42, [42]; Exhibit A1, Tab 7 at 171.

83. At the Extraordinary General Meeting held on 19 August 2016, the Minutes record a report from the Chairperson as follows:-

The on going repairs to the box gutter and roof, it was reported that the dust from the powder coater has corroded the box gutter and the roof in several places, The roof over lot 6 will need replacing because of the powder coating dust over a long time despite being the 2^nd youngest roof in the scheme (approx. 20 years old trim deck.) sections of the box gutter have been replaced over the last week, and the box gutters have been cleaned also.

…

MOTION 1: RESOLVED THAT, the minutes of the last annual general meeting of the owner’s corporation held on Friday 5 AUGUST 2016 AT 9am is confirmed.
David Nugent stated he believed that only an AGM can confirm an AGM and therefore this EGM cannot confirm the last meeting. Also he asked if his letter was in the AGM minutes. The chair stated he believed that this meeting could confirm the last, as it is a General Meeting but would confirm with legal. The chair also said that David Nugent’s Letter was tabled in the minutes of the AGM.

...

GENERAL DISCUSSION:

…

2. Dust from powder coating, as reported in the chairs report the roof and box gutter over lots 5 and 6 was in bad shape. David Nugent said he would inspect the roof, and then thanked the owners for paying Nick Wilson’s Cost in the local court matter the chair stated that the owners had a duty to comply with the law and was doing everything it could to do so. Nugent then asked why the levies only where balanced back six years [sic], the chair stated there was a limit on liability of six years as per legal advice. Nugent stated that Gene Barrett, “you got off lightly, The meeting become heated, at this accusation Geoff Barrett reminded Nugent its he who has benefited most because Gene Barrett has managed and maintained Nugent’s Lots 4, 5 & 6 for 13years free of any management or maintenance fee. The accusation that Gene Barrett is dishonest and got off lightly was hard for him to take.

3. Nugent’s left the meeting as the discussion became heated and personal. The remaining unit holders Geoff and Gene Barrett decided that the remaining general discussion items be put in the form of formal motions at the next EGM to be called next week. [183]

183. Exhibit A1, Tab 7 at 172-4; Exhibit A1, Tab 14 at 887-8.

84. Mr Nugent confirmed that there was discussion about dust from DPC at the meeting of 12 August 2016. [184]

    184. T 196.17-.49.

85. On 7 September 2016, an Extraordinary General Meeting took place of the Owners Strata, where Messrs Gene and Geoff Barrett, and Mr and Mrs Nugent were present. The Minutes record that the Owners Corporation approved for the Chairperson to issue a breach notice to DPC. [185] The Minutes further record that a resolution was passed in the following terms:-

MOTION 8: RESOLVED THAT the owners corporation will pass on to the owners of Lots 4, 5 & 6 false alarm charges incurred over the last 6 months due to the construction works being undertaken totalling $18,037.50 as attached in Annexure D. [186]

The Minutes further record:-

GENERAL DISCUSSION: The Chairperson opened the meeting for general discussion and the following matters were discussed without resolution:

...

iii) Discussion round Motion 4 (in relation to the breach notices for Dubbo Powder Coating), the chair pointed out the explanatory note in the notice of meeting; Dubbo Powder Coating tenants part of lot 5 and lot 6. Dubbo Powder Coating, since their tenancy commenced in 2004 have had noise and dust problems. Currently, the main on going issue is the dust that has corroded out the roof and box gutter over time. [187]

185. See Motion 4: Exhibit A1, Tab 7 at 175; Exhibit A1, Tab 14 at 893.

186. Exhibit A1, Tab 7 at 176; Exhibit A1, Tab 14 at 894.

187. Exhibit A1, Tab 7 at 176.

86. In cross-examination, Mr Nugent agreed that there was a discussion relating to the issue of a breach notice. [188] In relation to the false alarm charges, he rejected the suggestion that there was a peak of expulsion of dust from the powder coating business and or on construction work. He stated that he would need to see a log of the false alarms, when they happened over time and that he was never provided with that. [189]

    188. T 197.04-16.

    189. T 197.31-.46.

87. On 10 September 2016, the Owners Strata issued notices to comply with by-laws upon the Second Defendant. [190] The Notices contained statements under s 45 of the Strata Schemes Management Act 1996 (NSW). [191] The notices recorded breaches of the by-laws as follows:

    190. Exhibit C.

    191. Hereinafter referred to as “the 1996 Act”.

1. The first notice referred to actions believed to have been breaches of by-law 3, recording that:-

The owners corporation believes you have broken this by-law by: ...

Long term dust on Roof has lead to the Roof and Box Gutters on and around Powdering coating to rust out

You must comply with the by-law immediately by: …

Stop the dust, seeking Building consultant Report on damage and Rectification of Roof

2. The second notice referred to actions believed to have been breaches of by-law 3 and recorded:-

The owners corporation believes you have broken this by-law by: ...

Damage to common property, exhaust Fan Ducting Installed In Lot 5 Roof Pouring Dust onto the Roof

You must comply with the by-law immediately by: …

Ask for permission from the O.C. to Install the Duct work

3. The third notice referred to actions believed to have been breaches of by-law 11 and recorded:-

The owners corporation believes you have broken this by-law by: ...

excessive false alarms from Dust and Heat due to the powder coating process

You must comply with the by-law immediately by: …

Install appropriate detectors

4. The fourth notice referred to actions believed to have been breaches of by-law 12 and recorded:-

The owners corporation believes you have broken this by-law by: ...

Noise and dust from Dubbo Powder Coating and sand Blasting

You must comply with the by-law immediately by: …

i) An Acoustic Engineers Report required

ii) An Environmental Engineers Report required To report on rectification

88. On 27 October 2017, four further notices were issued under s 145 of the 2015 Act, [192] stating the Second Defendant had contradicted the by-laws as follows:-

    192. Exhibit C.

1. The first notice referred to actions believed to have been breaches of by-law Part 2 sec 4(A,B) and recorded:-

The owners corporation believes you have broken this by-law by: ...

excusive noise and dust is not contained within the lots dust and noise is polluting the neighbouring lots ( Lots 2,3,7&10) [sic]

You must comply with the by-law immediately by: …

Better filtration of the dust and noise coming from the powder coating and sand blassting [sic] process

2. The second notice referred to actions believed to have been breaches of by-law Part 3 sec 14 (1,2) and recorded:-

The owners corporation believes you have broken this by-law by: ...

The dust, paint and Heat that is not sufficiently filted [sic] is destroying the fire detection system. And since 24/4/15 to the 10/10/17 has caused 41 fire alarms

You must comply with the by-law immediately by: …

Better filtration of the dust, paint and heat coming from the powder coating and sand blassting [sic] process

3. The third notice referred to actions believed to have been breaches of by-law Part 3 sec 12 (2) and recorded:-

The owners corporation believes you have broken this by-law by: ...

The dust, paint and Heat that is extracted on to the roof (Common Property) is destroying the roof and box gutters

You must comply with the by-law immediately by: …

Better filtration of the dust, paint and heat coming from the powder coating and sand blassting [sic] process

4. The fourth notice referred to actions believed to have been breaches of by-law part 3 sec 15 and recorded:-

The owners corporation believes you have broken this by-law by: ...

The dust, paint and Heat that is extracted on to the roof (Common Property) has damaged the roof, box gutters, storm water systems and the fire alarm systems

You must comply with the by-law immediately by: …

Better filtration and house keeping of the dust, paint and heat coming from the powder coating and sand blassting [sic] process.

89. Mr Nugent agreed that these notices had been issued. [193]

    193. T 199.14-.200.03.

90. On 21 February 2017, the Owners Strata held an Extraordinary General Meeting where issues associated with the dust and damage to the roof of the Owners Strata were discussed. At that meeting, Messrs Gene and Geoff Barrett were recorded as being present along with Mr Nugent. The Minutes recorded:-

MOTION 7: RESOLVED THAT the owners corporation engage Bugden Legal, in accordance with its fee proposal dated 3 February 2017 (a copy of which is Annexure D to the notice of meeting), to commence a NCAT proceeding against Dubbo Powder Coating for:

(a) The false alarm charges incurred as a result of their negligent actions; and

(b) Damage on the life cycle of the roof sheeting, flashing, guttering and downpipes to Lot 6 caused by the powder coating business,

In the sum of $60,880.50, or such other amount as Bugden Legal may advise.

…

GENERAL DISCUSSION: The Chairperson opened the meeting for general discussion after the reports were presented.

The following matters were discussed without resolution:

1. Discussion of Motion 7: Mr. Nugent raised the prospect of the NCAT claim being successful. The chair pointed out that the claim was guided by Bugden Legal, experts in the field. Also, based on the findings in the Walton Smith Report (a copy of which was annexed to the notice of general meeting), the scope of damage caused by Dubbo Powder Coating was clear. Further, the chair indicated that it is also evident from the Orana Fire report that sand blasting dust, heat and the powder coating process damaged the smoke detectors.

2. Mr. Nugent repeatedly offended the chair, the chair showed frustration with Mr. Nugent who was not following the agenda. Mr. Nugent threatened to walk out on the meeting saying “if you’re going to raise your voice at me I am walking out of here.”

3. Discussion around Motion 7 continued, and Mr. Geoff Barrett stated that this motion and documents have already been properly assessed by the owners corporations’ solicitors, fire and building experts. This is in accordance with what Mr. Nugent had wanted where he stated several times in the past that he “wanted the owners Corporations run properly”

4. The chair was doing its job in the best interests of the owners corporation to investigate the issues caused by the operation of Dubbo Powder Coating and the motions proposed in the general meeting were doing just that, recovering the costs associated with the actions of Dubbo Powder Coating.

5. Mr. Nugent became narcissistic debating past legal matters beyond settlement, going over old ground and leaving the agenda.

6. Mr. Nugent stood up and attempted to physically intimated [sic] Mr. Geoff Barrett sitting opposite.

7. Mr. Geoff Barrett stated “you have come here for a fight not a meeting” Mr. Nugent then walked out.

8. Meeting continued, motion 8 was resolved and the chairperson’s report was tabled including a draft strata subdivision plan.

9. At the end of the general discussion, Mr. Nugent’s original undertaking was produced and read from the minutes of the first EGM 2^nd June 2004 that he would control all noise and trade waste from the tenancy Dubbo powder coating and sand blasting. [194]

194. Exhibit A1, Tab 7 at 178-9; Exhibit A1, Tab 13 at 954-5.

91. Mr Nugent agreed that the issues of dust and damage to the roof were probably discussed at the meeting of 21 February 2017. [195]

    195. T 197.48-198.07.

92. On 21 April 2017, a further meeting was held of the Owners Strata, however only Mr Geoff Barrett and Mr Gene Barrett were in attendance. The Minutes record as debts owed to the owners for Lot 5, being the Second Defendants, as $21,174.90 (less any payments made since 22 September 2016). For Lot 6, the debt owed to the owners, being the Second Defendants, was recorded as $25,580.21 (less any payments made since 22 September 2016). Under the heading of “Reports”, the Minutes record:-

…

5. Dubbo powder coating:

The recovery of false alarms, repairs to damaged smoke detectors and roof for lots 5 and 6 dew [sic] to long term damage from the powder coating activity, a claim will be issued to NCAT for the recovery of this damage based on Non compliance notices, Walton Smith report and orana fire protection advice. [196]

196. Exhibit A1, Tab 7 at 180.

93. The Minutes further recorded that debts would be recovered in the Local Court and that the costs for repairs for the roof, fire detection system and reimbursement of false alarms caused by DPC would be recovered by way of NCAT claim being prepared by Bugden Legal. [197] The Minutes further recorded that the chair was to forward an updated fire alarm schedule from the NSW Fire Brigade and forward it to Bugden Legal so that the Owners Corporation could be reimbursed. [198] Mr Nugent stated that he expected that he would have received a copy of these Minutes. [199]

    197. Exhibit A1, Tab 7 at 181-82.

    198. Exhibit A1, Tab 7 at 182.

    199. T 199.01-.02.

94. On 10 October 2017, the Annual General Meeting of the Owners Corporation was to take place. Mr Nugent gave evidence that in anticipation of that meeting, he prepared a note to address the points that were to come up. The note recorded:-

…

Regarding motions for upcoming AGM

Motion 2.

When NKH is engaged to act against Dubbo Powder Coaters, please get a written opinion as to the likely success of the NCAT procedure. Unfortunately the OC has a history of reckless action and litigation which has cost it dearly: about $k200 after illegally remarking car spaces and $2600 for an ill prepared claim against us for unpaid levies

I expect the OC litigation to be unsuccessful and wasteful because, mainly,

• Powder Coaters have not changed their operations since starting 2004 and operated without false alarms for over 10 years. The maintenance of the fire detection system is the responsibility of the OC and the continued efforts by its agent; Orana Fire Control, has been unable to stop the false alarms. Out of frustration of the OC’s efforts I instructed OFC to do whatever it took to stop the false alarms and paid them about $7000 to replace and try different sensors. False alarms are still occurring as Gene Barrett witnessed in this September when Steve Davis called him in to witness another false alarm with no observable cause. (Rather than suing DPC they have suggested they should sue the OC for not allowing there “quite enjoyment” of their premises and their loss of work time and disruption caused by constant false alarms and fire brigade visits).

• A reputable fire control company has inspected the system and has offered opinion that design and work on the current system is not appropriate. It is time to employ a more competent firm to fix the system.

• Walton Smith report is very poor quality and will not stand up to rigorous scrutiny. Most photos showing corrosion are clearly caused by evaporative coolers and old water leaks. They speculate, with no evidence that traffic damage is caused by DPC. There are many sky light panels, which have all been recently replaced and 14 roof penetrations above DPC, generating past or ongoing traffic, only 4 of which are attributable to DPC. WS’s maths does not add up. The roof is already approximately 45 years old. They estimate a normal life of 50-60 years which has been shortened by 25%. So the “shortened” life of the roof has already, or nearly, expired. Clearly not case. So what is the basis of the amount of the claim?

Unless the OC can show clear advice that litigation will be likely to succeed I ask that lots 4, 5 and 6 be exempt from these litigation costs.

Motion 3.

1. When we purchased the building there were no skylights in lot 4 or 5. I had Col Honeysett, a very reputable plumber install many skylights with his usual high level of workmanship. I installed some, mainly over roof penetrations left open after Hannan Print removed their equipment

292. Beyond that, the Defendants submitted that Mr Davis gave evidence that he did not recall anyone coming to replace detectors in his premises other than Mr Michael Theris, from Orana Fire Protection who replaced fire detectors in early 2017. [460] Mr Davis was not challenged on this aspect of his evidence.

     460. Exhibit A1, Tab 11 at 633, [261]; Exhibit A1, Tab 7 at 351.

Consideration

294. The claim for maintenance was not specifically identified in the Plaintiff’s Statement of Issues beyond the reference to “damage to the fire alarm system.” No issue was taken in this regard.

295. The evidence of Mr Gene Barrett indicates that work done in relation to the fire detection system required replacements in various lots of the premises. The invoices do not identify the lots in which the replacements occurred. It is clear that Mr Nugent himself arranged for Orana Fire Protection to carry out work in relation to DPC premises, which he was invoiced $7,177.50. [461] Mr Nugent’s evidence that it was paid, [462] was not challenged. Moreover its contents referring to “Powdercoaters’ is to be contrasted to the lack of a similar reference in the other invoices.

     461. Exhibit A1, Tab 7 at 351.

     462. Exhibit A1, Tab 13 at 801, [93].

296. Mr Davis himself could not recall anyone coming to replace detectors in his premises, other than the occasion early 2017. Beyond that, Mr Theris in correspondence with Mr Nugent, which was tendered as part of the Plaintiff’s case through the affidavit of Mr Gene Barrett, stated:-

The detectors around the site, except for your areas, are cleaned on a regular basis as the panel indicates how contaminated the detectors are. [463]

463. Exhibit A1, Tab 7 at 349.

297. This seems to accord with Mr Davis’ evidence. Beyond that, it is not apparent as to why Mr Nugent would have been required to carry out the work that he did through Orana Fire Protection in 2017. The Plaintiff has not identified any such claim for cleaning detectors as recorded in the Minutes, referable to Lots 5 and 6 at a time when other claims were being advanced.

298. In the circumstances and bearing in mind the contents of the invoices as submitted by the Defendants, I am not satisfied that the Plaintiff has established that they arise out of the pleaded activities.

Different fire detection system

299. The Plaintiff’s relied on the report of Mr Dylan Hughes of Dragon Project Engineers. [464] Mr Hughes was an expert as to automatic fire alarm and detection systems. He carried out an inspection on 4 July 2018. [465] In his report, Mr Hughes found that three smoke detectors in Lots 5 and 6 had been isolated, and there were a total of eight isolations in other tenancies. [466]

     464. Exhibit A1, Tab 21 at 1161-1288.

     465. Exhibit A1, Tab 21 at 1164, [2(e)].

     466. Exhibit A1, Tab 21 at 1168-9.

300. In his report, Mr Hughes stated:-

Dust contamination within smoke detectors.

In my opinion, the powder coat works carried out in tenancy 5 & 6 is producing substantial dust which is contaminating smoke detectors, causing them to malfunction and creating nuisance alarms. [467]

467. Exhibit A1, Tab 21 at 1169.

301. His report identifies that he examined three detectors within the tenancy in which he found dust contamination. These were loop 2 detector 27 and detectors 15 and 26. [468]

     468. Exhibit A1, Tab 21 at 1169 and 1171.

302. In the course of cross-examination, Mr Hughes conceded that he was not an expert in powder coating work or abrasive blasting. [469] He stated, however, that with the sort of dust that he would expect to see in Dubbo area, if the dust was external, would be a different colour from what shown in the purlins above the detector. He could see that the dust, which is shown in the photograph in his report, [470] as black with a bit of grey. He acknowledged that he wasn’t exactly sure which dust was causing the contamination, but stated that this would be a matter for the expert who was taking samples from the dust for testing. [471]

     469. T 226.35-.37.

     470. Exhibit A1, Tab 21 at 1171.

     471. T 226.45-227.10.

303. Mr Hughes then went on to state that the detection system within the premises was not compliant with Australian Standard 1670.01-1995, stating that the layout did not comply with the basic requirements, which required the distance between smoke detectors and adjacent thermal detectors to be approximately 10 metres. According to Mr Hughes, the maximum radius from a thermal detector was 3.6 metres and 5.1 metres for a smoke detector. In this instance, there was a short fall of 1.3 metres in terms of coverage. [472] In this respect, he stated that if the system was installed in 2003/2004 there would have been a period of around 8 years to get used to that Australian standard. [473]

     472. Exhibit A1, Tab 21 at 1171.

     473. T 227.26-.36.

304. Secondly, Mr Hughes observed that the system had been installed at the subject premises in accordance with a report prepared Dr Victor Shestopal. [474] It was noted as option 2(B) of Dr Shestopal’s report as an automatic smoke detection system and alarm system. Mr Hughes observed that in his opinion this meant that the main component of the system as proposed by the report is a smoke detection system with thermals only to be used in kitchens or the like. He noted that Lots 5 and 6 currently consists of both thermal and smoke detectors which in his opinion was non-compliant with the specific terms of the report. [475]

     474. Exhibit A1, Tab 21 at 1165. Dr Victor Shestopal’s report was annexed to Mr Hughes’ report and marked as Appendix D. It appears as Exhibit A1, Tab 21 at 1181-5.

     475. Exhibit A1, Tab 21 at 1171.

305. Thirdly, Mr Hughes observed that the smoke detectors 25, 26 and 27 in the tenancy were ionization type detectors which were allowed under the 1995 standard, however, were written of the subsequent standard (AS1670.1-2004). He stated that ionization smoke detectors are no longer used for commercial systems and even if ionization detectors were installed in 2003 they would only have a life span of 10 years and should have been replaced in 2013 with a photo electric type detector. [476] In cross-examination, Mr Hughes stated that it is typically the Owners Corporation who install the fire systems. [477] He stated that Dr Shestopal’s report recommended specifically the use of smoke detector for early warning, except in kitchens or shower rooms where you can’t use smoke detectors. [478] He specifically stated that thermals did not comply with Dr Shestopal’s intentions in this plans. [479] He accepted that that was a matter for whoever is installing and rectifying the fire detection system for each annual fire safety statement. [480] He stated that whilst it was possible that the thermals were installed at a later date, whoever installed or modified that system would need to ensure they complied with the Australian Standards. [481]

     476. Exhibit A1, Tab 21 at 1171-2.

     477. T 227.38-.40.

     478. T 228.13-.18.

     479. T 228.20-.25.

     480. T 228.26-.30.

     481. T 227.42-228.08.

306. Mr Hughes was of the view that the existing smoke detection systems within DPC should be redesigned to a VESDA aspirated type detection system, which drew samples of air from throughout the tenancy which is then monitored by a laser type smoke chamber. [482] This would involve a system of pipes which would draw samples of air which is then monitored by a laser type smoke detector. [483] He accepted that the current system was not suitable to powder coating applications. [484] Mr Hughes indicated that the installation of the new system would reduce the number of nuisance alarms provided the installation is designed and implemented correctly. As far as costing is concerned, Mr Hughes opined that the measures would cost some $41,000+GST (save $45,100 incl. GST). [485]

     482. Exhibit A1, Tab 21 at 1172, [8(a)].

     483. T 229.08-.10.

     484. T 229.12-.14.

     485. Exhibit A1, Tab 21 at 1172, [8(f)].

307. During the course of cross-examination, Mr Hughes was informed that the First Defendant was no longer operating in the complex and had vacated the premises in April 2019. [486] His recommendation for the VESDA system was based on the fact that DPC was operating. [487]

     486. T 229.29-.32.

     487. T 229.40-.45.

308. Mr Hughes went on to state in his report:-

The system is not damaged as such, it is affected by the dust resulting from current operations. The general operations at ground level are clean and tidy, however, the powder coating process creates a fine dust which has settled into the smoke and thermal detectors located at roof level and also within the steel purlins, which support the roof (refer to photos in section 7 above). The filter gauze on smoke detectors is not fine enough to prevent this type of dust affecting point type smoke detectors and is therefore unsuitable for this application. [488]

488. Exhibit A1, Tab 21 at 1172a.

309. This was further reiterated later on in his report, stating:-

The system is not damaged as such, it is affected by the dust resulting from current operations. [489]

489. Exhibit A1, Tab 21 at 1172a.

Plaintiff’s Submissions

310. The Plaintiff submitted that the amount claimed was derived from the report of Mr Hughes, and notwithstanding the absence of tenants in Lots 6 and part of Lot 5, the best evidence the court had, of course, was Mr Hughes’ total. It was argued that Mr Hughes did not concede that there would be no costs involved in the replacement required for the fire alarm system, but held that a replacement was required. It contended that it was a matter for the Defendants to convince the court, particularly in the absence of contrary evidence, as to what the replacement costs would be outside of the estimates provided by Mr Hughes. [490]

     490. Plaintiff’s Written Submissions at [69]; T 304.36-.45.

Defendants’ Submissions

311. In the course of written submissions, the Defendants argued that the “current use application” ceased in April 2019 and accordingly, Mr Hughes prescription for a $45,000 system was no longer relevant. In particular, the tenancy could be operated by a large range of tenants, many if not all of which would not require such a system. Even if this was the case, it would be a matter between the particular tenant/owner of the Lot and the Plaintiff. It argued that given the fact that the premises were currently empty, the laser system would not be required, and it would be unlikely such a system would be required for any future uses (such as hospitality or furniture storage), and a point detector would be sufficient. [491]

     491. Defendant’s Written Submissions at [117]; T 230.15-.30.

Consideration

312. The evidence of Mr Hughes establishes that the system he has recommended, and on which the Plaintiff has based its claim, was not necessary in the circumstances where the First Defendant is no longer occupying and using the premises. Beyond that, Mr Hughes’ report identified that the system is not damaged as such and was simply been affected by dust. Ultimately, if a replacement is to be made to the fire detection system, it would be dependent upon what use the premises are subsequently put to, and moreover, require compliance with the relevant Australian Standards. In all of the circumstances the Plaintiff has not made out this aspect of its claim.

Payment of fire brigade call outs and false alarm charges in respect of Lot 6 and Part of Lot 5

Plaintiff’s Submissions

313. The Plaintiff contended that based on the evidence of Mr Gene Barnett and Mr Blair, the Court would be satisfied that the fire alarms were contaminated by garnet.

314. The Plaintiff contended that the combination of the materials referred to by Mr Gene Barnett was the basis for an Updated Schedule of Damages [492] which broke down the fire alarm charges into three categories, being:-

1. Fire alarm charges for Lots 5 and 6: $41,212.50

2. Fire alarm charges occurring in Lots 5, 6 and the immediate neighbouring lots (Lots 2, 3, 4, 7 and 10): $91,258.00 [493]

3. Fire alarm charges in total: $114,569.50.

   492. MFI E.

   493. MFI E incorrectly calculated this as $91,245.00.

315. The Plaintiff submitted that the Court could and should find that the total sums associated with the false alarms should be paid by the Defendants given that:-

1. The False alarms have been attributed to the presence of garnet within the alarm system;

2. The evidence that the garnet had drifted from First Defendant’s former premises into neighbouring lots, not just on the roof; and

3. The increased frequency of the false alarms during 2016 and 2017 which the Plaintiff submitted was due to the construction work undertaken within the First Defendant to reallocate the wall between Lot 5 and 6. [494]

   494. Plaintiff’s Written Submissions at [65].

Defendant’s Submissions

316. The Defendants pointed out that none of the invoices identified Lots 5 and 6 in the complex as being the cause of any alarms; they were addressed to Lot 12/55 Wheelers Lane; no individual lots are identified; and it could not be known what lots the invoices relate to. In relation to the spreadsheet allegedly prepared by Romteck, [495] the Defendants submitted:-

     495. Exhibit A1, Tab 7 at 326-332.

1. There is no explanation of its provenance or how it was prepared;

2. A large number of the entries are incomplete;

3. There is no uniformity in the document;

4. It seems to have been prepared in a piecemeal fashion; and

5. Critically, there is no one from Romteck who has given evidence to attest to the fact that it is correct or to explain the spreadsheet. [496]

   496. Defendants’ Written Submissions at [99].

317. In the course of oral submissions, the Defendants conceded that the spreadsheet documents came from subpoenaed material, but otherwise reiterated its earlier submissions:-

Then I’ve discussed on the following page of my submissions at p 29 - we can probably go to para 98 on p 30 of the submissions - the reference in para 58 to a spreadsheet at tab 20 which is allegedly prepared by Romteck. We say that document has a number of deficiencies. There is no explanation of its provenance or how it was prepared. We accept that it came - or a version of it was part of a subpoena packet but there is no explanation of who prepared the document, how it was prepared, what it was meant to reflect, especially given the following matters; a large number of entries are incomplete, there’s no uniformity in the document, it seems to have bee prepared in a piecemeal fashion and critically there is no one from Romteck who has given evidence to attest to the fact that it’s correct or to explain the spreadsheet, given that it is in such a piecemeal fashion. We say your Honour would give it little, if any, weight without that sort of proper explanation for it. [497]

497. T 290.18-.30.

318. The Defendants further submitted that there was no evidence that the invoices had been paid by the Plaintiff at any time or were required to be paid. Accordingly, it submitted Plaintiff had failed to adduce any evidence that the Owners Corporation had suffered any loss in this regard. [498]

     498. Defendants’ Written Submissions at [93]-[94].

319. With respect to the charges claimed by the Plaintiff, the Defendants submitted that it could not have any liability in respect of the total false alarms “for the whole complex” ($114,569.50) or the false alarms for lots 5 and 6 in conjunction with the neighbouring lots ($91,245). It was submitted that there was no evidence of spread of garnet or dust within the other lots that has activated fire alarms in those lots. Further, there was no evidence taken from or anywhere near the fire detectors in the neighbouring lots, and there was no evidence at all that any fire alarms in any neighbouring lots were caused by the First Defendant’s conduct. As far as Lots 5 and 6 are concerned, attention was drawn that most of Lot 5 is the business operated by the Second Defendant, which since 2013 has been “Reward Hospitality” and before that was the Makin Mattresses Factory. It was contended that it was not possible to consolidate all charges for Lot 5 and Lot 6 in this way. [499]

     499. Defendants’ Written Submissions at [96]-[97].

320. The Defendants further pointed out that an attempt was made by the Plaintiffs to pass on to the owners of Lots 4, 5 and 6 false alarm charges over the last 6 months “due to construction works being undertaken.” [500] This was at the meeting dated 7 September 2016. The Defendant pointed out that there was no claim in the present proceedings that the false alarm charges were due to construction work, nor was there any claim in those Minutes in respect of false alarm charges in respect of the neighbouring lots.

     500. Exhibit A1, Tab 7 at 176.

Consideration

321. Whilst Mr Gene Barrett stated that from 2008 onwards he also saw substances that he considered emanated from DPC in neighbouring lots, particularly Lots 2, 3, 5, 7 and 10 (which were adjacent to DPC), fire alarm charges emanating from neighbouring lots wer neither documented in the minutes nor incorporated in the claim of 7 September 2016 which was said to relate to construction works. The Plaintiff advanced little evidence other than Mr Gene Barrett’s assumption that DPC’s activities triggered the false alarms elsewhere in the Property.

322. I have noted the contents of the correspondence from Orana Fire Protection, dated 13 December 2016 stating that the activities at the powder coaters were setting the detectors off and also detectors in the adjacent lot. The letter also identified the alarms being set off in other lots but didn’t identify the source as DPC’s activities. In respect of the affected lot, it was recommended that the walls be extended so contaminants created by the powder coaters do not intrude into the areas next door and set them into alarm. Mr Hughes who carried out an inspection on 4 July 2018 does not appear to have examined alarms in neighbouring lots. Apart from the location of garnet in the neighbouring tunnel, Mr Blair didn’t examine neighbouring lots, let alone identify the cause of any fire alarms being triggered

323. The author of the correspondence of 13 December 2016 from Orana Fire Protection and the context in which it was written was not identified. The observations made appear to be limited to the neighbouring Latex factory which I infer is a reference to the Lots occupied by the Second Defendant and Mr and Mrs Nugent.

324. The correspondence of 11 April 2017 from Mr Theris was objected to by the Plaintiff as an annexure to Mr Nugent’s affidavit of 19 July 2016. For reasons given on 19 March 2020, I held that the correspondence was inadmissible by reason of s 69(3)(a) of the 1995 Act. At the time the objection was being dealt with, neither party drew attention to the fact that the correspondence had already been admitted into evidence without objection through the reading of the affidavit of Mr Gene Barrett dated 3 August 2018. [501] After I reserved judgment, my Associate wrote to the parties on 14 May 2020, drawing the matter to their attention and inviting any further submissions by 18 May 2020. The Defendants submitted that the emails should, in the circumstances, remain admitted but advanced no further submissions on the matter. The Plaintiff’s primary position was that the relevant correspondence should be excluded as it is indistinguishable from that which was ruled inadmissible. [502] Alternatively, it submitted that if admitted, it would carry little to no weight as it is entirely unreliable and must be irrelevant to the adjudication of the facts in the proceedings. [503]

     501. Exhibit A1, Tab 6 at 47, [62] and Tab 7 at 349.

     502. Plaintiff’s Submissions in Evidential issues in dated 18 May 2020 at [7].

     503. Plaintiff’s Submissions in Evidential issues in dated 18 May 2020 at [10].

325. The document in question was admitted into evidence at the instigation of the Plaintiff. It remains in evidence. However, its weight must be assessed having regard to the matters which informed my ruling of 19 March 2020, its context with other evidence and the fact that the Defendants advanced no substantive submissions based on it. That letter appears not to be addressed to anything concerning neighbouring properties except to refer that “sensors were going into alarm and could not be identified as they had deteriorated and the indicator lights were no longer showing.”

321. In the circumstances I cannot determine the extent of contaminants in any fire alarms in neighbouring lots emanated from the First Defendant’s operations, let alone that this led to a triggering of false fire alarms. This part of the claim fails.

322. In the context of Lots 5 and 6, the Plaintiff has prepared a schedule listing 32 claims of alarms said to set off in Lots 5 and 6. These have been claimed by reference to the documents earlier described. The corresponding contents of each document have been collated in the attached spreadsheet that I have prepared for the purposes of comparison (Annexure A). With reference to MFI E, each call out date has been allocated a number. For instance, the claim for 26 September 2012 is Claim 1; the claim for 30 November 2012 is Claim 2; and so on and so forth.

323. The primary document going to the charges appears to be the records of Romteck Grid Pty Ltd and the associated Fire and Rescue NSW Fire Alarms Records Management Systems Billing advices. [504] I have assumed that the relevant costs claimed by the Plaintiff have been derived by dividing the total reimbursement and administration fees by the number of charges. These documents do not indicate the location of the detector triggering the fire alarm.

     504. Exhibit A1, Tab 7 (15).

324. The descriptions provided in the invoices appear to be generic descriptors for the call out referable to a code. It shows:

Code	Description	Total
732	Smoke detector suspected malfunction e.g. continuous or intermittent fault in detector or FIP (defective apparatus)	7
733	Heat detector suspected malfunction e.g. continuous or intermittent fault in detector or FIP (defective apparatus)	3
738	Alarm system suspected malfunction	1
752	Heat detector operated - no fire - e.g. heat from oven; dryer; heater; hair straightener etc.	5
758	Simulated conditions - e.g. incense; candles; sparklers; smoke machine; smokers materials etc	3
765	Alarm activation due to workers/occupiers activities	9
766	Alarm activation due to poor building maintenance - e.g. dust; cobwebs; damage; insects; etc.	1
772	Fire Indicator Panel active; Alarm Signalling Equipment not activated	1

330. Notably only one claim, being Claim 12 (4 August 2016), is said to be due to poor building maintenance eg dust cobwebs; damage; insects; etc but goes no further than this.

331. The records of the main panel of the fire detection systems are not comprehensive and only embrace Claims 1, 2, 3, 4, 15, 16, 17, 18, 21, 22, 23, 24, 25, 31 and 32. However, in each instance the times do not align with records of NSW Fire and Rescue. In Claims 31 and 32 there was no record of an invoice from NSW Fire and Rescue tendered. Furthermore, Claim 3 marks a case where the detector is said to be in Lot 4, which is acknowledged in MFI E. In relation to Claim 23, MFI E identifies a reference to the relevant fire alarm log reference. [505] However, that reference is incorrect, and there are a number of fire alarms for that Claim date (10 April 2017) in the fire alarm detection log.

     505. Referencing Exhibit A1, Tab 18 at 298, Event No. 298.

332. I accept the Defendants’ arguments in respect of the Romteck spreadsheet. It is not apparent as to when, how and in what circumstances that document came to be prepared. Whilst Mr Gene Barrett has stated that based on data from Fire and Rescue NSW, which showed the fire alarms in the complex and charges from 2005 to 31 May 2018, there is nothing in the Fire and Rescue documents to indicate where the detection source was derived. A specific detector is only indicated in Claims 9, 18, 19, 22, 23, 25, 27 and 28, although there is no claim in the case of 27 and 28. [506] Claim 9 is also referred to as being in the rear of the ‘Reward” storage area. Claims 14, 16 and 18 have incomplete details of the detector location. Claim 29 indicates that it is not in either Lots 5 or 6 but rather in a place identified by reference to Exhibit B as “Nagles.” Of the claims lacking a detector indicator, Claims 4, 6, 8, 11, 13, 17, 20, 24, 31, and 32 do not identify “Powder coaters”.

     506. MFI E recognises this, indicating the cost for these entries as “Nil”.

333. In the end I can have no reliance on this document to indicate the source of the activation, let alone the cause. Mr Hughes’s relied on material from Romteck to suggest the alarms were malfunctioning and creating nuisance alarms. That assumption was based on the information Romeck schedule annexed to Mr Gene Barrett’s affidavit. [507] Whilst I was advised that the material supplied to Mr Hughes was different, being a reduced version of entries with two extra columns, in the form presented to the Court it was unreadable. [508] In the circumstances, I have had to proceed on the version in the annexure to Mr Barrett’s affidavit as containing the content of the material Mr Hughes relied on. [509] Beyond that Mr Hughes, did not undertake any testing to support his conclusion. To the extent Mr Hughes’ opinion rests on the Romteck schedule I cannot accept it.

     507. Exhibit A1, Tab 7 (20).

     508. Exhibit A1 Tab 21 at 1283-4.

     509. See T 41.21-43.111.

334. Accordingly this part of the Plaintiff’s also fails.

Summary

335. The Plaintiff has succeeded in its claim for roof repairs in the sum of $12,395.00 but failed in respect of the other components of its claim.

ORDERS

336. For these reasons the Court orders:

1. Verdict and judgment for the Plaintiff in the sum of $12,395.00

2. The Defendants are to pay interest on the said sum from 17 November 2017 to date in accordance with s 100 of the Civil Procedure Act 2005 (NSW) and District Court Practice Note 15 clause 5

3. I will hear from the parties as to costs.

Annexure A (19225, xlsx)

Note: Formatting and typographical errors have been amended since the Judgment was handed down on 16 July 2020.

Endnotes